The Biggest, Most Inevitable Bull Market
- Grow richer every day with this investment
- A historic supply crunch
- How to invest today
Does your portfolio have exposure to the most inevitable bull market in the world? I’m talking about a long-term trend that has nowhere to go but up. It’s literally a life and death situation.
The alternative to a bull market in these commodities is something the world’s population has to strive to avoid at all costs. It’s more important than oil, more vital than coal, and way more serious than gold, copper, iron - or any other industrial metal or energy commodity.
Because if there’s not more production of this particular group of commodities every day, in perpetuity, most people on this planet will starve.
Yes, I’m talking about food. And I realize it’s not an “exciting” investment, not like some new oil discovery or a massive gold bonanza. But the world’s population is growing.
According to a 2004 study from the United Nations, “World population is projected to grow from 6.1 billion in 2000 to 8.9 billion in 2050, increasing therefore by 47 per cent.”
Okay, so a 40 year timeline is a little long, but consider another statistic from the UN:
The world’s population will increase by “57 million a year on average between 2000 and 2050…
It means that, on average each year for 50 years, world population will expand by about as many people as now live in Italy.”
So a new food consumer is born every half second. This market differs from any other – because food (and water) is something that everyone needs to live. Sure, lots of people use oil, coal, copper and other energy commodities – but the market for food is so much more pervasive and important.
And sure, you can make the argument that much of the world’s food production is dependent on cheap energy, but it’s a chicken vs. egg situation. We wouldn’t use so much oil if we didn’t need so much food!
So there are more people every day – and this trend will account for increased demand. But what about supply?
I found some alarming statistics in a paper by some folks at Utah State University titled, “Fifty Years of Farmland Change: Urbanization, Population Growth and the Changing Farm Economy.”
They say that total farmland in the continental US declined by over 200 million acres between 1949 and 2002.
It’s an inevitability that a long term trend of fewer farms and less farmland coupled with more people can not last forever. The short story is that even the big producers will get pinched as energy prices continue to rise, along with demand for food, and eventually demand for farm land.
Someday we’ll see a mad scramble as people crave degrees in botany and become farm advisors, just like we saw everyone clamor to go to business school a few years ago to become a Wall Street advisor.
In fact, we have a mini-model to base this prediction on. After the USSR fell, our friends in Cuba saw the end of the many and sundry subsidies they received from Russia, whether they were oil, food, or machinery.
Overnight, farms sprung up around Cuba – and today, farmers are among the wealthiest people on the island.
The good news for us is that we’re talking about easily tradable commodities here. Corn, wheat, soy, even picks and shovels like tractors, fertilizer and other farming hardware are easy to buy and sell in the stock market with any brokerage account.
We don’t plan on timing the market on this one. We already have several agriculture plays set up across several portfolios, including a “green” fertilizer company in the SmallCap Investor Pro lineup. It’s up 76%.
We also have a fertilizer producer in our Global Commodity Investing portfolio that’s up over 34% so far. Click here to find out more about our 30 day trial subscription to Global Commodity Investing, and to find out the name of this fertilizer company.
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Good Investing,
Kevin McElroy
Editor
Resource Prospector
